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Amid the weaponisation of the US dollar and Western financial sanctions, BRICS and Global South nations are accelerating efforts to bypass the Belgium-based SWIFT messaging network.
Context
What SWIFT Is
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- Society for Worldwide Interbank Financial Telecommunication
- A standardised, secure messaging network used by financial institutions to transmit instructions and information, such as money transfers, via standardised SWIFT/BIC codes
- It is a messaging platform — not a settlement system or a bank
- Founded 1973, headquartered at La Hulpe, Belgium
- A member-owned cooperative under Belgian law, collectively supervised by the G10 central banks
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Key Features
- Pure messaging architecture — transmits payment orders, letters of credit and securities instructions; the actual movement of money relies on correspondent banking accounts (Nostro/Vostro)
- Standardised protocol — 8- or 11-character Business Identifier Codes (BIC) and the ISO 20022 messaging framework
- Belgian and EU jurisdiction — obligating compliance with EU sanctions
- Security — end-to-end hardware encryption, dedicated secure lines and geographically distributed operations centres
The Alternatives
- CIPS (China) — launched 2015 to internationalise the yuan; enables cross-border RMB messaging, clearing and settlement across 120+ countries
- SPFS (Russia) — developed 2014 after Western sanctions; connects Russian banks with foreign institutions, including Iran’s SEPAM
- Project mBridge — a blockchain-based multi-CBDC platform developed by participating central banks, enabling direct cross-border settlement using CBDCs, bypassing SWIFT and correspondent banking
